Student Support: reforming the student maintenance system is long overdue

When the student maintenance system was changed in 2012, the minimum maintenance loan available to students was £5,500. In equivalent terms, students today should receive £7,605. However, the baseline maintenance loan available today for students living away from home is £4,767. This wasn’t enough for most students in 2012; the evidence that this doesn’t cover today’s housing costs, let alone other basic living essentials, is irrefutable. 

Students who cannot afford to relocate close to campus but are able to commute to their provider receive less maintenance funding. Against a backdrop of rising public transport costs and volatile fuel costs, the amount of maintenance funding available to students has remained finite and increasingly consumed by inflationary pricing. For students at IHE members like Matrix College, who design their programme delivery for commuting students on specific days of the week and at weekends, this is making it increasingly difficult to plan and budget against the maintenance loan they receive over the duration of their studies. 

If students cannot afford to commute or relocate to study on campus, then something in the funding system has to give. This is why, in our Manifesto for higher education, we are calling on the incoming Government to increase the maintenance loan amount in line with inflation, offer maintenance grants to those most in need, and extend maintenance funding to students studying online. Instead of forcing students to increasingly rely on parental income (also squeezed by the same inflationary pressure) or to work more than 20 hours a week, we should recognise that the landscape within which students are studying today is fundamentally different to the landscape that existed when the funding system was designed. 

Students undertaking online degrees (increasingly more common post-pandemic) are studying the same hours as those who study in-person. These learning hours are tangible. However, the current system does not provide maintenance funding for these students, inferring that online learning hours are somehow less significant or simply exist in a liminal realm of study time. The suggestion is that maintenance loans are only for students who are working around studying rather than those studying around work, regardless of how many hours are allocated to each activity. In an age of delivery that is becoming increasingly flexible and modular, and where more students are working to afford study, this is not defensible or sustainable. 

A change in approach could also help to address long term population drains in ‘cold-spot’ communities where there is limited higher education provision. Online delivery provides access to higher education wherever students are located. On-campus models force these students into choosing to relocate to more urban centres to receive maintenance funding to enable them to study. By design, the funding system is taking talent away from rural areas - and it is unlikely that this talent will return post study. With the right funding system, online learning could help deliver vital support and skills to our rural communities.

But even if maintenance funding was granted to students studying online and raised in line with inflation, one simple fact remains: more loans pile more student debt. Are grants a more sustainable alternative, where they will have the highest impact? Representative polling by the Sutton Trust has suggested that over half of the UK’s population is in favour of reinstating maintenance grants in line with our Manifesto asks. There is also a credible possibility that running a grant system for these students would result in reduced treasury costs too. 

In a system where the loan amount repaid is contingent upon income, it is a token gesture that we do not bankrupt students through short repayment periods. Higher education would be even less accessible if that were the case. However, the most recent changes to the student finance system mean that students will be required to start paying back these loans at much lower incomes, and for an additional ten years. The employment market continues to discriminate – by class, gender, disability, race, and more. An income-contingent model forces those who face this discrimination (who already earn less because of it) to pay more for their education because they pay it off over a longer period, accumulating more interest every year. There is a risk that debt averse students may decide to never access higher education - increasing maintenance loans to meet soaring costs of living will only add more debt. 

Where is the balance in the current system, where those who borrow the most, and take the longest to pay it off, receive value for money for their education? What is the cost to Government of the exorbitant interest charged to these students, who are likely to struggle to pay back much more than they borrowed? We do not yet know the answers to these questions – the research has not caught up with the pace of change in the student finance system. We urge the incoming Government to carry out such an assessment, to review the balance of costs and the long-term benefits to students and Government, factoring in the benefits of the skilled workforce created through accessing higher education.  

There is huge value – both for society and the economy – in ensuring underrepresented students can study in higher education. All students should have the opportunity to make the most of their education. Higher education should remain an environment where students have equity of access, where they can gain skills and access careers support to begin to combat an inherently discriminative job market. By putting in place robust changes to fix the broken maintenance funding system we will be cultivating our higher education sector, and the students within it, to grow successfully throughout the next five years and beyond.